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Management Capital, L.L.C. v. F.A.F., Inc.

Superior Court of Rhode Island

May 16, 2017

MANAGEMENT CAPITAL, L.L.C., Plaintiff,
v.
F.A.F., INC. and ARTHUR FIORENZANO, Defendants.

          For Plaintiff: Joseph V. Cavanagh, Jr., Esq.

          For Defendant: Rajaram Suryanarayan, Esq. Robert D. Wieck, Esq.

          DECISION

          SILVERSTEIN, J.

         Before the Court are Defendant F.A.F., Inc.'s (F.A.F.) post-trial motions: a motion for a new trial pursuant to Super. R. Civ. P. 59(a); and, in the alternative, a motion to alter or amend the judgment pursuant to Super. R. Civ. P. 59(e) (collectively, the post-trial motions). Management Capital, L.L.C. (Management) objects to both motions. The Court exercises jurisdiction pursuant to G.L. 1956 §§ 8-2-13 and 8-2-14.

         I

         Facts and Travel

         F.A.F.'s post-trial motions arise out of a decision that this Court rendered on January 17, 2017. See Mgmt. Capital, L.L.C. v. F.A.F., Inc., No. PB-2008-2364, 2017 WL 265064 (R.I. Super. Jan. 17, 2017) (Silverstein, J.). On January 17, 2017, this Court, sitting without a jury, decided three issues that were presented at trial: (1) whether Management established by clear and convincing evidence that there was a mutual mistake between the parties necessary to warrant contract reformation; (2) whether the term "funded debt"-as used in the common stock warrant made between the parties (the Warrant)-meant "all debt" or "long-term debt"; and (3) whether F.A.F. anticipatorily repudiated the Warrant, which granted Management certain put and call rights.[1] The Court found in Management's favor on all three of those issues. Specifically, the Court reformed the Warrant to reflect what the evidence established as the true intent of the parties, held that the term "funded debt" meant "long-term debt, " and concluded that F.A.F.- through a series of statements and actions that amounted to a positive and unconditional refusal to perform-anticipatorily repudiated the Warrant. Id. at *6, 7, 12. After concluding that "Management [] proved its damages with reasonable certainty, " the Court found that Management was entitled to damages in the amount of $1, 234, 055, plus prejudgment interest. Id. at *13, 14.

         Shortly after the Court rendered the aforementioned decision, Management moved to enter an order purporting to accurately reflect the Court's findings of fact and rulings of law in this case; however, F.A.F. strenuously objected to the form of the order. After accepting memoranda and hearing from both parties on that matter, this Court again found in Management's favor and entered an order and judgment on March 22, 2017 awarding Management $1, 234, 055, plus prejudgment interest and costs. The Court's entry of the order and judgment prompted the post-trial motions presently before the Court.

         On March 31, 2017, F.A.F. timely filed the post-trial motions, which were accompanied by a memorandum over sixty pages in length. Management filed an objection as well as its own memorandum, after which F.A.F. filed a reply memorandum. On April 24, 2017, the Court heard from both parties. After considering the arguments set forth both on paper and in person, the Court now decides F.A.F.'s post-trial motions.

         II

         Standard of Review

         Pursuant to Super. R. Civ. P. 59(a), "[a] new trial may be granted to all or any of the parties and on all or part of the issues for error of law occurring at the trial or for any of the reasons for which new trials have heretofore been granted in the courts of this state." Moreover, "[o]n a motion for a new trial in an action tried without a jury, the court may open the judgment if one has been entered, take additional testimony, amend findings of fact and conclusions of law or make new findings and conclusions, and direct the entry of a new judgment." Id. Interpreting Rule 59(a) of our Rules of Civil Procedure, the Rhode Island Supreme Court has consistently held that: "a trial justice sitting without a jury may grant a new trial only

'(1) if there is an error in the judgment that is manifest on the face of the record without further examination of matters of fact or evidence;[] or (2) if the trial justice is satisfied that newly discovered evidence has come forward which was not available at the first trial and is of sufficient importance to warrant a new trial.'" Manchester v. Pereira, 926 A.2d 1005, 1015 (R.I. 2007) (quoting Tillson v. Feingold, 490 A.2d 64, 66 (R.I. 1985)) (emphasis added).

         Put another way, Super. R. Civ. P. 59(a) motions brought after a nonjury trial may only be granted if the trial court finds that it committed a manifest error of law based "on the face of the record" or upon ...


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